Electric Car Prospects Stall, Awaiting Battery Improvements.
“These numbers are so low because it will still make more sense to have an internal combustion engine in 2025 using fossil fuel”
As investors start to lose faith in Tesla Motors and its battery-powered future, some of the more brazen claims for electric cars generally are starting to look a bit ambitious.
But as battery-only sales tread water, hybrids, freed of the curse of range anxiety, will spurt ahead.
Too much faith has been put in the development of lithium ion batteries, according to Donald Sadoway, Professor of Materials Chemistry at the Massachusetts Institute of Technology (MIT). He wants more imaginative investment to produce radical improvements.
A couple of years ago BMW, which is leading the way with battery-only i3 and i8 plug-in hybrid vehicles, said within four to five years electric cars will have twice the current power and double the range. BMW board member Ian Robertson added then, that in the next three to four years there will be more progress in battery development than in the previous 100 years.
Not much sign of that and time is running out.
Given that the current range of battery-electric cars like Nissan of Japan’s Leaf is currently only about 75 miles on a good day and it costs about twice as much as a similar sized conventional car, sales prospects of these cars have been cut back sharply from initial claims. Nissan of Japan affiliate Renault of France quietly dropped its early prediction that global electric car sales will reach 10 per cent by 2020. Last week Nissan, apparently exasperated with progress, said it was considering switching its battery suppler to LG Chem of South Korea, from the venture with Japan’s NEC Corp.
The U.S. was supposed to have one million plug-in vehicles on the road by 2015, but at the end of last year this had only reached about 290,000. Germany might be embarrassed to be reminded that its target is one million plug-ins by 2020, but a barely measurable 14,000 have so far been sold there.
Reflecting this general downgrading of prospects for battery only vehicles, IHS Automotive recently looked again at its medium to long-range forecasts. It raised its prediction for battery-only vehicles in 2020, but to just one per cent of the global market from just under one per cent. This will creep up to 1.5 per cent by 2025. One piece of good news though for those pursuing the compromise route of hybrids and plug-in hybrids; IHS Automotive says their share will rise to seven per cent in 2020 from a previous estimate of almost five per cent, and accelerate to 16 per cent from its previous prophecy of just over six per cent in 2025.
Meanwhile investment bank UBS urged investors to sell Tesla Motors shares, saying its share price reflected deliveries of 1.5 million cars in 10 years, which it thought was unrealistic. Other investment banks are cooling on Tesla too.
MIT’s Sadoway said battery development has been disappointingly slow, and this will hurt sales of electric cars generally.
“Development (of lithium-ion batteries) is not going to be significant enough to change the price performance ratio for it to have an impact on auto sales predictions. These numbers are so low because it will still make more sense to have an internal combustion engine in 2025 using fossil fuel,” Sadoway said in an interview.
Sadoway said battery prospects haven’t been helped by the price of oil falling to unpredicted low levels. And technically, battery success depended on the amount of energy you could put in, and how long it took before it began to fade or weaken, and the overall cost of ownership.
“If you have to replace the battery every three years and that costs 80 per cent of the price of the car, that isn’t going to work. But if the cost was like replacing a set of tires,” Sadoway said.
Research into improving lithium-ion batteries was looking like a cul-de-sac.
“I truly believe that the breakthrough will come outside the lithium-ion area. A vast amount of money has been spent with little to show for it, but we’ve been looking for incremental improvements, of one to five per cent, that’s not going to make any difference to the number of electric vehicles on the road,” he said.
Lux Research of Boston, Mass., doesn’t say much in the way of lithium ion battery performance improvement, but does think Tesla and its Panasonic of Japan partner will bring costs down sharply by 2025 to $172 kWh at the pack level. This would best in class cost.
But Sadoway insists that new ideas are needed for as big breakthrough.
“I’ve tried to market my ideas of beyond lithium, but they are seen as too radical, too high a chance of failure. I don’t see much chance of success because resources are not being sensibly allocated. We need something better than incremental change. This will come from universities letting loose unfettered minds doing radical research. But the total amount of money is really very small and the likelihood of a major breakthrough? Your guess is as good as mine,” Sadoway said.